AMR expects Q2 loss because.....

If there is any booking away, as FWAAA suggests (and I think this is a real possibility) the employees are working in a totally self-defeating manner.

How do you think AA will increase your compensation when it's bringing in less money?
 
If there is any booking away, as FWAAA suggests (and I think this is a real possibility) the employees are working in a totally self-defeating manner.

How do you think AA will increase your compensation when it's bringing in less money?

Well helping them bring in more money didnt work. We bring in over $100,000 more per person per year than we did in 2003 but instead of paying us more with a portion of that they pay us less, and they want us to give more concessions and a zero cost contract!!!!

It may be time to run this thing into the ground so others that are willing to be fair can expand.
 
Well helping them bring in more money didnt work. We bring in over $100,000 more per person per year than we did in 2003 but instead of paying us more with a portion of that they pay us less, and they want us to give more concessions and a zero cost contract.

AA showed a large net loss in 2003, so much of that $100k per employee you keep repeating would be used up just to get back to breakeven. On top of that, AA's fuel bill is tens of thousands of dollars more per employee than in 2003. Combined, there is no $100k per employee sitting around.
 
Attempting to defend AA's costs on the basis of being "more labor intensive" misses the point that AA is no different from any other company in the US in that it must make money - and the bottom line is THE BOTTOM LINE - and includes all costs, regardless of whether contract or not.

AA's revenue generation has never been the problem - up to this point. AA does a very good job of finding and going after premium revenue - but when AA is pulling back int'l flying to Europe in key competitive markets like ORD while UA is adding, when DL is adding service in key NYC markets, and when AA is pulling back from connecting traffic throughout the US and focusing on just 5 major markets, the results are bound to add up fairly quickly to AA being uncompetitive in network coverage - while DL and UA/CO will have truly global coverage - and network coverage absolutely has been shown to translate into revenue premiums. The whole reason for mergers and ATI/joint ventures (which are really revenue side only mergers) is to compete effectively on the basis of size.... there is no example of a successful niche network airline. Even YX which filled that bill on a somewhat regional basis has failed. AS realized they had to grow into the major leagues instead of being a niche regional airline.

There isn't evidence that passengers are booking away either. AA's traffic is on par w/ other carriers and fits AA's network.

The simple facti s that AA has a 15% cost disadvantage to DL and CO which have almost identical costs and 8% to UA - which is still AA's largest network competitor. A cost advantage of that magnitude leaves AA with one choice and one choice only - shrink the airline to fit the locations where AA can successfully compete - which is why AA is focusing on just 5 key cities- incidentally where AA is relatively large and where the low cost threat is lower than in other parts of AA's network.

But it doesn't stop competitors like UA and DL from going after AA - which they are doing. And unlike DL and UA, there is no viable merger strategy for AA which involves bulking up to increase the advantage of those carriers relative to AA.

The simple fact is that AA MUST have competitive costs in order to survive - and it must come from labor because THAT is where AA's cost disadvantage exists. AA can't outsource any number of parts of its operation to lower cost providers - and like it or not that is reality. Key AA employee groups don't work as much for the same money as other airline employees.


I agree that AA mgmt is not being as aggressive in addressing problems - but your job as employees is to convince the Board of that.... and there is always the option for an employee buyout - if you can really agree that returning AMR to a competitive position is the first and really only goal. UA's ESOP failed because employees decided to use their ownership position to wring every last little bit of wealth from the company.

AA/AMR has about 2 years to turn things around or the combined UA/CO plus DL - which will continue to grow and go after AA markets - will make it nearly impossible for AA to compete as a network carrier in the US. Having a size and cost disadvantage relative to two major competitors will be a virtual death sentence.

The US NEEDS three strong network airlines - and AA should be one of them. It is up to labor and management at AA to figure out what they need to do to make it work.

BTW, of the carriers that have reported so far,
DL had a 10.4% operating margin
UA had a 8.4% operating margin.

CO, AS, and WN are all expected to post double digit operating margins. We will see how they perform.
 
If there is any booking away, as FWAAA suggests (and I think this is a real possibility) the employees are working in a totally self-defeating manner.

How do you think AA will increase your compensation when it's bringing in less money?



You better check your facts they brought in 680+ million more this quarter!!!